It's not just middle-aged people that are trying to lose weight. Semiconductor manufacturer Atmel
The North Tyneside facility was sold to Taiwan Semiconductor Manufacturing Company
But that's not all ...
This sale is part of a larger strategy -- the company also announced the sale of a facility in Irving, Texas, in May -- to move to what is called a "fab-light" business model. This means that, while Atmel will continue to run some of its own manufacturing operations, it will farm out a portion of its production to other companies. By doing so, it is following in the footsteps of other semiconductor companies like Texas Instruments
So why are semiconductor manufacturers going fab-light?
Well, it turns out that converting to a fab-light operation gives another big benefit besides lower capex requirements. A company that contracts out a portion of its manufacturing may be able to bring that manufacturing back in-house in the event of a slowdown. This helps a business maintain its margins during downturns, which is a big advantage in a cyclical, capital-intensive industry like semiconductor manufacturing.
Obviously the semiconductor foundries are beneficiaries as well. Companies like Taiwan Semiconductor and United Microelectronics
For further Foolishness: